The European Central Bank's (ECB) pandemic emergency purchase program PEPP is the subject of new lawsuits at the German Constitutional Court. In the fight against the economic consequences of the Corona pandemic, the ECB has made available almost 2 trillion euros for bond purchases. In an interview with the Neue Zürcher Zeitung, Volker Wieland said that the new sovereign debt in the euro area was thus at least temporarily monetized by the ECB.
Currently, the ECB is purchasing bonds in a volume that would allow it to buy up the entire net new debt of the member states. According to Wieland, whether the purchases constitute prohibited monetary government financing would ultimately have to be clarified in legal terms. In Wieland's view, however, it is important for the central bank to communicate how it intends to reduce its bond holdings again in the medium term. So far, he has not seen a clear exit strategy.
Neue Zürcher Zeitung: "Verfassungsklagen gegen die EZB: Ziehen deutsche Richter den billionenschweren Pandemie-Anleihekäufen den Stecker?"